How to decide the price level of your fashion line? This is a major question to answer when you first start your fashion line. It is the second one after who is your customer. My new clients find this very hard to answer. Many times they can find the answer by shopping the stores and looking at the lines they feel are their competition. However there are times when the answer eludes them. They see that their line can go into several different places. So what are the different levels? The following is a guide that can help.
- Popular – a low price that people are willing to pay.
- Moderate – a product that is neither very cheap nor very expensive compared to other products of the same type. It is a level up from popular.
- Better – this is the next level up from moderate. It consists of better quality product, but is not as high as luxury.
- Bridge – this department was developed to “bridge” the gap between better and designer.
- Designer – top of the line, luxury products.
Within these areas different stores further define things. Contemporary and young designer are ways for retailers to segregate departments so that there is more clarity for their customers.
When deciding what is best for your brand you will need to define the demographics and psychographics of your customer. Knowing their income and how they spend their money can give you great insight to what department would better serve them.
Then when you have decided, the lines prices must reflect a value proposition relative to where the competition is positioned. The reasoning is that the overall competitions prices establishes the price points that a customer will see and compare your product to. If you are higher than your competition there must be a real justification for it.
Sometimes you might want to offer really cheap prices but do not have the level of production that will get you the best prices from factories. In those cases it might be best to make the product superior to what it hangs with and that will allow for the extra cost. When you aren’t pricing apples to apples then your customer will forgive the extra expense.